Bulgarian Property Developments has defended its rejection of a £17.3m takeover bid by entrepreneur, Joe Lewis.

The AIM-listed developer said that Lewis’s bid of 16p a share was at an 83% discount to its net asset value a share of 50.6p and promised to deliver higher returns ‘by the end of the year or sooner’.

It dismissed the offer as ‘opportunistic’ and ‘manifestly inadequate’ because it represented only 17% of the £54.8m that its assets were valued at by Colliers CRE on 27 February.

It also said that the offer failed to recognise its cash position of £8.7m and, including cash in escrow, £11.6m.

It urged shareholders not to accept the offer from Lewis’s company, Windsorville, on the grounds that it could deliver higher returns through the sale of assets, including its principle asset, the Sofia Central Commercial Site.

The board also said that Colliers had confirmed that its valuation price would increase by £21.1m if the Sofia Central site obtained planning consent for higher density – which it said it was confident of achieving in the ‘near future’.

Shareholders have also been offered the incentive of a 4p a share payment upon Windsoville’s offer lapsing.

It told shareholders: ‘The offer of £17.1m will buy cash in escrow totalling £11.6m. So, in effect, Windsorville is offering just £5.7m for the remaining assets of the company which are valued at £49m or £79m (allowing for the rezoning at Sofia Central Commercial Site).

'The board views the Windsorville offer as tantamount to acquiring the company for next to nothing. The board urges you to reject this opportunistic and unsolicited offer.’